Helia Group Limited · ASX:HLI
Helia — Investor Presentation (November 2017)
26 slides from Helia's investor presentation, Nov 3, 2017
Slide 1: Genworth Mortgage Insurance Australia 3Q 2017 Financial Results Presentation
Genworth Mortgage Insurance Australia 3Q 2017 Financial Results Presentation 3 November 2017 ©2017 Genworth Mortgage Insurance Australia Limited. All rights reserved.
Slide 2: Disclaimer
Disclaimer This presentation contains general information in summary form w hich is current as at 30 September 2017. It may present finan cial information on both a statutory basis (prepared in accordance w ith Australian accounting standards w hich comply w ith International Financial Reporting Sta
Slide 3: Introduction
Introduction Georgette Nicholas, CEO
Slide 4: 3Q 2017 and YTD financial results summary
3Q 2017 and YTD financial results summary (A$ millions) 3Q16 3Q17 Change % 3Q result in line with expectations Gross written premium 92.5 88.9 (3.9%) • GWP lower on changes in the customer portfolio Net earned premium 115.9 100.1 (13.6%) and reflects the impact of $0.8 billion of NIW in bulk portfol
Slide 5: Macroeconomic conditions
Macroeconomic conditions Delinquency rates by geography Unemployment rates (seasonally adjusted) Change Change State Sep 16 Sep 17 State Sep 16 Sep 17 (basis points) (basis points) New South Wales 0.32% 0.31% (1) bps New South Wales 4.9% 4.6% (30) bps Victoria 0.39% 0.39% - Victoria 5.8% 6.0% 20 bps
Slide 6: Detailed financial performance
Detailed financial performance Luke Oxenham, CFO
Slide 7: 3Q 2017 income statement
3Q 2017 income statement (A$ millions) 3Q16 3Q17 Change YTD16 YTD17 Change 3Q16 v YTD16 v 3Q17 YTD17 Gross written premium 92.5 88.9 (3.9%) 282.2 271.2 (3.9%) Movement in unearned premium 40.7 28.1 (31.0%) 116.7 91.2 (21.9%) Gross earned premium 133.2 117.0 (12.2%) 398.9 362.4 (9.2%) Outwards reinsu
Slide 8: New insurance written
New insurance written NIW1 by original LVR2 band NIW1 by product type A$ bn, % A$ bn, % 87% 84% 85% 85% 84% 84% 84% 84% 83% 82% 81% 10.5 10.5 23% 8.5 8.5 7.8 7.8 7.2 20% 7.2 6.6 6.8 6.8 6.4 6.2 16% 6.3 6.4 6.6 6.1 6.2 6.1 6.3 29% 18% 16% 5.5 5.5 44% 22% 17% 18% 18% 20% 99.4% 49% 46% 42% 99.2% 50% 54
Slide 9: Gross written premium
Gross written premium GWP and average price of flow business GWP walk A$ m , % A$ m 2.0 (21.5) 2.0% 92.5 1.83% 15.9 88.9 1.77% 1.78% 1.69% 1.57% 1.57% 1.56% 1.60% 157.6 1.53% 1.42%1.48% 1.5% 127.7 124.7 104.8 99.7 1.0% 97.5 92.5 94.1 85.0 88.2 88.9 0.5% 0.0% 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1
Slide 10: Net incurred claims
Net incurred claims (A$ millions unless otherwise stated) 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 Number of paid claims (#) 280 286 321 312 356 355 376 Average paid claim 1 ($’000) 65.8 79.2 73.3 65.0 92.5 112.2 110.6 Claims paid1 18.4 22.7 23.5 21.3 32.9 39.8 41.6 Movement in non-reinsurance recoveries
Slide 11: Loss development
Loss development Quarterly delinquency roll and incurred loss drivers Delinquency roll 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 Opening balance 5,552 5,889 6,413 6,844 6,731 6,926 7,285 New delinquencies 2,697 3,215 3,214 2,786 2,852 3,145 2,887 Cures (2,080) (2,405) (2,462) (2,587) (2,301) (2,431) (2,650
Slide 12: 3Q 2017 regulatory capital position
3Q 2017 regulatory capital position (A$ in millions) 31 Dec 16 30 Sep 17 NIW by original LVR band and Probable Maximum Loss Capital Base $ bn Common Equity Tier 1 Capital 2,012.8 1,922.2 Tier 2 Capital 200.0 200.0 2.60 2.59 Regulatory Capital Base 2,212.8 2,122.2 2.51 Capital Requirement 2.36 2.36 P
Slide 13: Balance sheet and unearned premium reserve
Balance sheet and unearned premium reserve Strong balance sheet with $3.4bn in cash and investments and $1.1bn in UPR Balance sheet as at 30 Sep 2017 Unearned premium by year as at 2010 30 Sep 2011 2012 2017 1% 2% (A$ in millions) 31 Dec 16 30 Sep 17 5% Assets Total UPR $1.1bn Cash and cash equivale
Slide 14: Summary and conclusion
Summary and conclusion Georgette Nicholas, CEO
Slide 15: 2017 outlook
2017 outlook • Australian economic conditions have moderated recently as the economy continues to transition away from the mining investment boom. • The unemployment rate posted modest improvement since year end but key labour market indicators remain mixed. Under-employment remains elevated, implyi
Slide 16: Questions
Questions Georgette Nicholas, CEO Luke Oxenham, CFO
Slide 17: Supplementary slides
Supplementary slides M4 Genworth =, <.
Slide 18: Genworth value proposition
Genworth value proposition Innovation and technology will underpin Genworth’s value proposition Market & regulatory changes Genworth value proposition • Changing credit cycle • Customer focused • New and refined bank capital • Risk management partner requirements • Mortgage market insights • Tighter
Slide 19: Genworth's Strategic Objectives
Genworth’s Strategic Objectives A refined strategic plan to re-ignite profitable growth over the medium term Mission: We support Australians in realising their dream of homeownership through the provision of capital and risk management solutions to mortgage lenders Vision: To be the leading provider
Slide 20: Residential mortgage lending market
Residential mortgage lending market Originations and HLVR penetration1 A$ bn 37% 34% 33% 31% 31% 27% 27% 24% 22% 22% 371 376 335 37 31 300 52 40 51 262 256 40 240 242 49 219 46 36 41 26 31 188 41 43 47 50 43 199 200 14 40 166 27 139 102 99 98 111 74 99 71 80 80 83 93 65 68 63 66 48 2008 2009 2010 20
Slide 21: Residential mortgage lending market
Residential mortgage lending market Investment vs. owner-occupied (APRA statistics)1 Investment vs. owner-occupied3 (Genworth) $ bn, % $ bn, % 40% 30% 27% 36% 37% 34% 35% 25% 34% 24% 32% 33% 23% 31% 23% 29% 21% 20% 20% 21% 136 128 136 109 12.5 8.7 76 84 81 78 6.7 8.0 8.6 68 8.4 65 6.2 5.2 6.4 235 24
Slide 22: Insurance in force and New insurance written
Insurance in force and New insurance written Insurance in force (IIF)1 by original LVR2 band, as at 30 Sep 2017 IIF1 by product type, as at 30 Sep 2017 Total IIF $322 bn Low HomeBuyer Plus Doc 3% Other 95.01%+ 60.01-70% 5% 1% 2% 6% <60% 8% 90.01-95% 28% 70.01-80% 16% 85.01-90% 80.01-85% Standard 32%
Slide 23: Insurance ratio analysis
Insurance ratio analysis Expenses Combined ratio 29.7% 64.0% 71.1% 57.1% 60.1% 61.3% 66.6% A$ m , % 27.3% 26.0% 25.7% 25.7% 28.5% 53.4% 59.2% 50.5% 23.4% 25.2% 25.8% 25.2% 26.6% A$ m , % 43.9% 43.5% 31.9 82.4 30.3 29.9 30.9 29.9 30.8 29.7 73.4 73.8 29.1 27.6 26.6 27.2 64.8 66.7 61.4 61.7 63.6 57.3 2
Slide 24: Delinquency development
Delinquency development Quarterly delinquency composition Delinquencies by book Delinquencies by Dec 16 Sep 17 Dec 16 Sep 17 year geography 2008 and prior 2,928 2,912 0.40% New South Wales 1,106 1,126 0.31% 2009 882 931 1.01% Victoria 1,378 1,368 0.39% 2010 430 383 0.56% Queensland 2,102 2,255 0.72%
Slide 25: Delinquency development
Delinquency development1 Favourable performance post 2009 • 2008 book year was affected by the economic downturn experienced across Australia and heightened stress experienced among self-employed borrowers, particularly in Queensland, which was exacerbated by the floods in 2011. • Post-GFC book year
Slide 26: Income statement reconciliation
Income statement reconciliation Reconciling to the US GAAP figures reported by Genworth Financial, Inc . Walk from US GAAP AUS segment results to Quarterly Less Quarterly AUD Adjustments Total Genworth AIFRS Genworth Consolidated Income supplement non - supplement equivalent adjustments group Statem